Forwarders support foreign NVOs using NRAs

Wednesday, May 01, 2013

The National Customs Brokers and Forwarders Association of America said it strongly supports extending exemptions pertaining to non-vessel-operating common carrier negotiated rate arrangements (NRAs) to foreign-based, unlicensed NVOs as well as U.S.-licensed companies.
The association said the continued existence of NVO rate tariff publication no longer serves a useful purpose because shippers don't use them and they are able to conduct business with NVOs through the private negotiation process that has evolved since the enactment of the 1998 Ocean Shipping Reform Act.
"The only support for the continue requirement of mandatory tariff publication has come from several tariff publishers, who understandably are not pleased to lose a significant source of revenue," NCBFAA said in a response to a Feb. 21 request by the U.S. Federal Maritime Commission on a proposal to extend the exemption to foreign NVOs (FMC Docket No. 11-22).
NCBFAA said “the continued publication of NVOCC rate tariffs does not appear to serve any useful public purpose, there was little reason to continue those mandatory publication requirements for any NVOCCs, including foreign-based ones. Accordingly, the current restrictions precluding foreign-based registered NVOCCs from using the NRA process should be dropped.”
In its comments to the FMC, NCBFAA said allowing foreign-based unlicensed NVOs to use NRAs "would increase, rather than reduce, the overall level of competition in this industry" and not adversely affect competition between NVOs.
NCBFAA said it also agrees with a FMC proposal to require that all foreign-based NVOs provide certain minimal information about their companies, renew their registrations every three years, appoint agents in the United States for service of process purposes, and make their records available upon request by the commission.
“As these are all requirements that are imposed on U.S.-licensed NVOCCs, making the same requirements applicable to foreign companies both supports the FMC’s regulatory responsibilities and helps provide a level playing field for U.S. companies,” NCBFAA said.
NCBFAA said in its filing that "although it has now been in effect for almost two years, there are still a large number of domestic NVOCCs that have not yet sought to take advantage of the exemption. The NCBFAA believes that the transition from tariffs to NRAs has been slower than expected due in large part to industry perceptions about the complexity and technical requirements of the existing regulations.
"As the existing regulations in Part 532 could be simplified without harming the shipping public, further simplification would expand those benefits to more companies," the association said. - Chris Dupin